The amazing synchronicity of the Global Development (the 1300s-1450s). An institutional approach to the globalization of the late Middle Ages

Badalian, Lucy and Krivorotov, Victor
(2010)
The amazing synchronicity of the Global Development (the 1300s-1450s). An institutional approach to the globalization of the late Middle Ages.
Economic History Working Papers,
139/10.
Department of Economic History, London School of Economics and Political Science, London, UK.

Abstract

In a new approach to a long-ranging debate on the causes of the Late Medieval Debasement, we offer an institutional case-study of Russia and the Levant. Avoiding the complexity of the “upstream” financial/minting centres of Western Europe, we consider the effects of debasement “downstream”, in resource-exporting periphery countries. The paper shows the amazing synchronicity of the worldwide appearance of the early modern trading system, associated with capitalism or commercial society. The centre-periphery feedback loop amplified trends and pushed towards economic and institutional changes. This is illustrated via the Hanseatic-Novgorodian and Italian-Levantine trade – under growing market pressure of the exploding transaction costs, the oligopolies gradually dissolved and were replaced by the British-Dutch traders. In this case-study the late-medieval/early-modern monetary integration served as the transitional institutional base for reducing transaction costs during a dramatic global shift. Highlighting centre-periphery links, a new trading outpost of Arkhangelsk rose synchronously with Amsterdam.